Jakarta market loses ground on regional slide
Jakarta market loses ground on regional slide
JAKARTA (JP): The rupiah weakened to 13,200 against the U.S.
dollar yesterday and stock prices dropped 1.3 percent on regional
weaknesses, dealers and stockbrokers said.
Currency dealers said the rupiah was hovering above the 13,000
level in quiet trading as investors saw no fresh incentives in
the market after Indonesia's donors pledged US$7.9 billion in aid
to the country last week.
They said bearish sentiment in the regional market also
weighed down the rupiah, sending the currency to a day low of
13,400 to the dollar.
Dealers said the huge aid commitment pledged by the
Consultative Group on Indonesia (CGI) helped prevent the rupiah
from slumping further against the American dollar.
"Unlike other regional currencies, the rupiah was not that
affected by the Japanese fall," a chief dealer with a local
private bank said.
The rupiah ended yesterday's trading at 13,150/13,250 to the
dollar, weaker than its Friday close at 13,000.
Dealers said the Japanese yen, which fell past the 145.5 level
to the dollar, sent a negative sentiment to all currencies in the
region.
"Although the rupiah was affected by the Japanese fall, its
impact was small thanks to the CGI commitment," the chief dealer
said.
Dealers said news that the Armed Forces (ABRI) would
investigate former president Soeharto's son-in-law, Lt. Gen.
Prabowo Subianto, in connection with the kidnapping of political
activists would improve sentiment over the rupiah.
"Investors have often raised the question whether ABRI will be
committed to investigating high-level officers involved in the
abduction of the country's activists," a dealer with another
local private bank said.
Although ABRI has taken some positive measures, concern over
the country's social and security problems remain unresolved, he
said.
"This is still a big question for investors," the dealer said.
The bearish sentiment also infiltrated the Jakarta Stock
Exchange (JSX), which saw its main price index fall 1.3 percent.
Speculative
The JSX Composite Index closed 6.54 points down to 475.25 on a
total turnover of 131.93 million shares changing hands on the
regular market valued at Rp 153.91 billion ($11.65 million).
Stockbrokers and analysts attributed the fall to profit taking
by speculative investors.
"Trading activities were quiet yesterday because the market
did not expect any more positive news in the local bourse,"
Antonio Yongnata, an analyst at Mashill Jaya Securities, said.
He said most investors, who made gains prior to the conclusion
of the CGI commitment last week, put in large selling orders to
take profits yesterday.
The head of research at Sigma Batara Securities, Fadjar Limin
Sutandi, said the local bourse would remain sluggish until the
government imposed clear-cut measures to restore the country's
social and political climate.
"We don't expect any capital inflow from offshore funds if the
social and political climate does not improve first," he said.
Most large-cap stocks closed lower yesterday. Heavyweight
state-owned local telecommunications firm PT Telkom was unchanged
at Rp 4,350, while state-owned international call operator PT
Indosat was down Rp 225 to close at Rp 14,350.
Cigarette giant PT Gudang Garam fell Rp 100 to Rp 8,800, while
competitor PT HM Sampoerna also dropped Rp 225 to Rp 3,175. (aly)